Housing market gap opens between metropolitans

A gap in the strength of the housing market is opening between the three metropolitan centres and the rest of the country, a new survey shows.

The New Zealand Property Report from property listing website Realestate.co.nz said the pendulum had swung in the direction of a buyers' market, with Auckland, Wellington and Christchurch the conspicuous exceptions.

For the country as a whole the level of inventory -- the number of weeks of average sales that would be needed to clear the market -- rose to 36 weeks in November, the latest monthly report, published today, said.

That was up 5 percent from October, although down 32 percent from a year earlier.

At the same time the number of listings nationally rose 2 percent from October, and 4 percent from November 2008, to 13,857.

The national average asking price last month was $419,586 -- only marginally up from October and a 2 percent rise on the previous three months.

The steady growth in listings during the past three months had begun to outpace the rate of sales of property across the country, leading to the growth in inventory levels, the report said.

Compared to the 36-week national figure, the inventory level for Auckland was 27.6 weeks, up 5 percent from October but down 43 percent from a year earlier.

In Wellington, inventory was equal to 17.7 weeks of average sales, up 9 percent on the month, while also down 43 percent from November 2008.

For Canterbury the inventory was 26.3 weeks, up 1 percent from October and down 40 percent over the year.

A 4.1 percent rise in asking prices in Auckland, compared to the prior three months, was a direct result of the tightness of the market, with inventory levels remaining tight as the flow of new listings seemed to be being met by a steady demand, the report said.

The same inventory tightness in the other main centres of Wellington and Canterbury did not seem to be directly having an impact on asking prices, for now.

For the country as a whole the pendulum had swung in the direction of a buyers' market as the inventory of property on the market was being bolstered by rises in new listings which was meeting a steady, yet uninspiring, sales level, the report said.

Of 19 regions covered in the survey, 11 showed inventory levels running significantly above long term averages.

"The only conspicuous regions reversing this trend are the three metropolitan regions of Auckland, Wellington and Canterbury all of which are showing inventory levels well below long term averages and well below the national average."

The three metropolitan regions were showing characteristics more akin to a sellers' market, the report said.

That had prompted some speculation of an emerging property bubble, but the broader data clearly refuted that assertion.